Take-up of office space in Birmingham increased marginally last year compared with leasing activity in 2022, according to the latest data from Savills.
Total take-up in 2023 reached 703,000 sq ft – the first time it has exceeded the 700,000 sq ft mark since 2019 – bolstered by 240,000 sq ft of activity in Q4 – a 14% rise compared with Q4 2022.
Public services, education and the health sector acquired the most space in 2023, representing 30% of the total take-up. Professional services followed at 18% and insurance and financial services firms accounted for 17%.
Rental growth remained steady with headline rents at £42/sq ft. It is anticipated this will rise to at least £43/sq ft by the end of 2024 with prime rents expected to reach £48/sq ft by 2027.
Ben Thacker, director in Savills Birmingham office agency team, said: “Birmingham’s office market showcased resilience in 2023 despite economic headwinds, with a 1% year-on-year increase and a strong full-year take-up of 703,000 sq ft. We are seeing numerous examples of consolidation taking place, manifesting as inward investment for the city. The projected future rental growth and a consistent 4% annual growth rate over the past decade affirm Birmingham as a dynamic and steadfast hub for businesses and investors of all types, attracted by the city’s diverse demographic profile, outstanding transport infrastructure and range of office stock on offer.”
Mark Walsh, EMEA head of corporate account management, global occupier services at Savills, added: “We’re seeing many occupiers having a clearer understanding of their real estate requirements post-Covid. Businesses continue to focus their leasing requirements on Grade A offices which have excellent ESG credentials. This has been driven by the desire to satisfy employee needs and ensure staff return to the office, in addition to supporting wider corporate sustainability ambitions.”
